Grants / Feed-in-Tariffs
Feed-in-Tariffs
The new feed-in-tariff scheme is now up and running as of the 1st April 2010. This tariff scheme sets values for generated electricity from wind turbines, photovoltaic panels, hydro and anaerobic digestion. The scheme has replaced the Low Carbon Buildings Programme capital grant scheme for these technologies and so there are no longer grants available for wind turbines, pv or hydro.
The key points of the scheme are: sub 4kWp p.v. tariff set at 21p/kWh, additional export rate set at 3.1p/kWh , 50/50 split between usage and export assumed, lifetime of the tariff confirmed at 25 years (for pv), FIT's will only be payable on systems installed by a MCS accredited installer, energy efficient measures will not be a pre-requisite for the payment of FIT's until April 2012, after which an EPC rating must done and a grade C or above attained to receive the full value of the FIT. To protect value the tariffs are index linked to the Retail Price Index and all systems installed since the 29th July 2009 are eligible for the tariff.
Example: A 3.92 kWp Solar PV system consisting of sixteen 245 watt panels.
Using SAP, we would estimate that this system will produce 3365 kWh in a year (south facing).
You will receive 21 p/kWh on all of the 3365 kWh production and an extra 3.1 p/kWh on assumed exported electricity, this is deeemd to be 50% of the total production. So you will recieve £707 (21p x 3365) plus £25 (3.1p x 50% of 3365) which is a total tariff value of £759.
Add on the saving of not buying 50% of 3365 at 14.5p/kWh (assumed) which is £244, giving a total yield £1003.
A 4 kWp system would cost in the region of £9000 inc vat so this gives a yield of 11.2% ROI p.a.
Anyone can claim the feed in tariff for which they eligible as soon as the installation is complete. The FIT is paid to the system owner by their FIT licensee, usually the electricity provider, quarterly and is funded by the government's Microgeneration Certification Scheme.
To view the Department for Energy and Climate Change FIT document please click here.
Who can apply for the Feed-in-Tariff?
If there is already a registered system this can be added to but the rate of the tariff will change if the kWp threshold is met for a higher output/lower payment rate system.
The Renewable Heat Incentive
The scheme offers incentives to install solar hot water panels, heat pumps and solid biomass boilers and came into effect in April 2011. It applies to all systems installed since July 2009. How it works: If you install a ground source heat pump and it is replacing an oil or gas boiler you will be paid for the amount of heat that the system produces (either deemed or metered). This has transformed the payback times and is the first heat tariff anywhere in the world for microgeneration. The Renewable Energy Association has summarised the RHI in this document.
How RHI works: The maximum annual payment under the higher tier 1 rate (7.9p/kWh) is the maximum output of the system multiplies by 1314 (15% of 1 year, average 3.6 hours a day). Any output above this is paid at the lower tier 2 rate (2p/kWh) to prevent "over heating" for profit. The thermal output of the system is recorded accurately with an approved meter.
Example: 8kWth (kilowatt-thermal) MCZ Ego wood pellet stove.
The maximum tier 1 payment would be £830.45
PLUS potential fuel saving of £157.68 (compared to heating oil)
(2011 Estimated average prices: Oil@ 5.7p/kWh, Wood Pellets @ 4.2pkWh)
This gives a total annual yield of £988.15 and a potential full system payback of 3-4 years!
With fossil fuel prices ever increasing further savings could be made in the future whilst helping prevent climate change!
To view the Department for Energy and Climate Change RHI document please click here.
Who can apply for the Renewable Heat Incentive?
Any installation of applicable technology carried out by an MCS accredited installer since July 2009 is eligible for the RHI although this cannot be claimed until the relevant part of the scheme has been introduced.
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